Innerwear and knitwear major Rupa & Company is navigating a phase of heightened competitive intensity, with aggressive pricing strategies weighing on margins during the quarter, even as the company doubles down on volume-led growth and portfolio expansion to drive recovery.
Management acknowledged that pricing conditions have become increasingly competitive across segments, with elevated trade schemes exerting above-normal pressure on net realisations. To remain competitive and protect market share, the company adopted aggressive pricing strategies, including higher dealer incentives and, in some cases, extended credit periods.
The cumulative impact of these measures, with discounts and schemes averaging around 12%, resulted in lower gross and operating margins for the quarter.
“The primary reason for margin contraction has been intense price competition in the market,” the management said during its earnings call. “In order to match peer pricing and remain competitive, we had to pass on higher schemes and extend credit selectively, which impacted realisations.”
Despite the near-term pressure on profitability, Rupa is prioritising volume-led growth to strengthen its market presence. The company believes that this approach will create a resilient foundation for margin recovery once pricing pressures moderate. Its diversified brand portfolio and continued focus on operational efficiencies are expected to support this rebound.
The company is also accelerating its push into emerging and high-growth channels beyond traditional general trade. It is expanding its presence in modern trade, e-commerce, and exports, supported by a strengthened team dedicated to these verticals.
At the same time, Rupa is broadening its product portfolio to align with shifting consumer preferences in a price-sensitive environment. The company is investing in new categories such as athleisure and activewear, while significantly expanding its women’s wear offerings with competitively priced products designed for wider acceptance.
Management noted that while the economy segment underperformed relative to mid-premium and premium categories during the quarter, it expects growth momentum to return in the coming quarters. The company is developing a more aggressive, price-sensitive portfolio aimed at driving stronger acceptance across channels, including modern trade.
While acknowledging that current margin levels are not sustainable in the long term, the company expressed confidence that revenue growth, channel diversification, and portfolio recalibration will improve overall performance in the quarters ahead.
With a sharper focus on new-age channels, category expansion, and market-aligned pricing strategies, Rupa & Company is positioning itself to balance competitive pressures with long-term growth ambitions.